Presenteeism and absenteeism are both directly related to the health of an employee both through the employee’s physical condition and mental state (De Lorenzo-Romanella 2011). This essay aims to provide an insight into how both presenteeism and absenteeism due to poor health can affect Australian businesses productivity. As there is limited Australian studies relating to this topic, overseas studies have been reviewed. This comprised of mainly American studies due to the cultural similarities. A brief explanation of what is meant by the terms presenteeism and absenteeism, is needed to help the evidence to show by what means productivity can be affected. Also reviewed is how certain industries require different measures to collect specific data and why there is conjecture about converting presenteeism and absenteeism to monetary values. In addition the results of some employee health programs that have been implemented by some employers will be presented. Presenteeism is the term used for when an employee is present in the place of work, whilst not functioning at 100 percent productivity. This could be due to the employee’s health condition referring to the employee’s physical or mental state or a combination of both (Sanderson et al. 2007; Bergstrom et al. 2009; Brooks et al. 2010; Stewart et al. 2011). Employee self reporting questionnaires is usually how presenteeism is assessed and this is demonstrated throughout the various literature that is presently available. Conditions such as depression, arthritis, obesity, anxiety seem to be the main causes of presenteeism in employees which is depicted in a graph by Loeppke et al (2009, p. 423).

Absenteeism is a term that is used for the unscheduled absence of an employee from work (Bacharach, Bamberger & Biron 2010). Like presenteeism, absenteeism by an employee could also be caused from poor health